Remortgaging When House Value Has Increased in Leicester

Owning a property, whether it’s your family home or a buy to let investment, is a significant asset. It’s not just a place to live, but holds the potential for financial gain if you ever look to sell, as well as being something you can pass down to future generations.

The property market is dynamic and ever-changing, and property prices can skyrocket during certain periods. When this happens, it may be beneficial for you to explore your options for a remortgage in Leicester.

Doing so could give you access to a more favourable loan-to-value ratio and better interest rates, potentially allowing you to maximise your investment.

What is a loan to value and why do people remortgage in Leicester for a better one?

Loan to value (LTV) is the ratio of mortgage to the property’s market value, expressed as a percentage. For instance, if you buy a property for £100,000 with a deposit of 10% (£10,000), you’ll need a mortgage with a 90% loan to value.

Mortgage loan to values are divided into tiers or brackets. Typically, the lowest bracket will be 60% and increase to the highest ratio of 95%. The brackets or tiers offered will vary depending on the mortgage lender.

If you have a lower loan to value, you’ll have access to mortgage deals with more competitive interest rates.

In the example above, let’s say your property value has increased to £110,000 and your initial mortgage balance of £90,000 has come down to £80,000 after some years. This means that your new loan to value is 73%.

If you were to remortgage in Leicester, you would now be eligible for a 75% loan to value mortgage, which should have a more competitive rate of interest. Other factors such as market conditions will also determine this interest rate at the time of remortgaging.

The reason why lower loan to value mortgages have more competitive interest rates is that you pose less risk to the mortgage lender.

How do I find out the value of my property?

In order to access better rates or terms when you remortgage in Leicester, you will need to determine the current value of your property. This can be done by obtaining a valuation, which involves either an Automated Valuation Model (AVM) or a physical valuation.

An AVM involves using a database to cross-reference similar properties in the same area to determine the value, without someone physically coming to your location.

On the other hand, a physical valuation involves an inspector coming to your home to inspect both the interior and exterior, taking into account any home improvements or extensions you may have had.

If you prefer a physical valuation, you can discuss this with your mortgage advisor in Leicester during your free appointment. It’s important to note that when you remortgage, you’ll be switching to a new mortgage lender, unlike a product transfer where you stay with the same mortgage lender.

The new mortgage lender will want to know the value of the property they will be lending against as part of their risk assessment.

Remortgage in Leicester to Release Equity When Home Value Has Increased

While leveraging the equity in your home can sometimes lead to better deals, another reason to remortgage in Leicester is to release equity for other desired purposes.

This is often done for home improvements or other reasons, but it requires careful planning. When you remortgage, you’ll be taking out a new mortgage to replace the old one, but with a higher loan-to-value ratio.

As a result, your monthly mortgage payments may increase. That being said, the goal is to invest in your home and increase its value so that when you remortgage in Leicester again, you’ll be on a lower loan-to-value ratio.

It’s essential to have a well thought out plan and gauge the markets, especially when dealing with such a significant financial investment like your home. A mortgage advisor in Leicester can provide guidance on the best approach for your situation.

Can I remortgage in Leicester early if the value of my home has increased?

There may be occasions where you consider remortgaging earlier than expected. Although remortgaging in Leicester before your fixed-term ends is technically considered “early”, you might have the option to do so even a year before.

Breaking your contract terms could result in paying an early repayment charge (ERC), which is a downside to this option.

While it’s impossible to predict housing market conditions, people usually choose to exit their mortgage early for compelling reasons. If you plan to remortgage early, it’s advisable to engage a mortgage broker in Leicester to help you assess your options.

For instance, during the COVID-19 pandemic, the Bank of England base rate dropped to historic lows, allowing those due to remortgage in Leicester at the end of their fixed rate period to enjoy low interest rates.

On the other hand, if you were a year away from your fixed-rate ending, you wouldn’t be able to benefit unless you remortgaged early and extended your period.

This scenario is rare and unique, given that mortgage lenders withdrew most of their products, limiting people’s options.

Yet, it exemplifies how remortgaging early could financially benefit you. If your property’s value has appreciated, it’s an opportune time to consider remortgaging early to take advantage of lower loan-to-value rates.

But keep in mind that you might still incur an ERC and other costs, such as arrangement, valuation, and solicitor fees, on your new mortgage.

So, it’s crucial to weigh the potential savings against the overall costs before committing. Speaking with a mortgage broker in Leicester is recommended to fully understand your options.

Can I Remortgage in Leicester and Extend The Term?

If you’re a homeowner in Leicester, there are many reasons why you might consider remortgaging your property. Perhaps you want to release equity to finance a large expense, like home improvements or debt consolidation.

Alternatively, you might be looking for a better deal on your mortgage repayments or want to switch to a different type of mortgage product.

Whatever your reasons, it’s important to explore all of your options when it comes to remortgaging. While many people focus on getting a lower interest rate or releasing equity, there’s another option that you might not have considered: remortgaging to extend your term.

By extending your mortgage term, you could potentially lower your monthly repayments, making them more affordable and giving you greater financial flexibility.

This could be especially beneficial if you’re experiencing financial difficulties, or if you want to free up some extra cash to invest in other areas of your life.

At Leicestermoneyman, we understand that every homeowner’s situation is unique, which is why we offer a range of remortgaging options to suit your individual needs.

Whether you’re looking to release equity, lower your monthly payments, or extend your term, our experienced advisors can help you find the best solution for your circumstances.

So if you’re considering remortgaging in Leicester, be sure to explore all of your options – including the possibility of extending your term – and get in touch with us today to find out how we can help you achieve your financial goals.

Why would I remortgage in Leicester to extend my term?

The length of time you agree to pay back your mortgage, known as the term, can significantly impact your monthly mortgage payments. Many homeowners opt for a term of 25-30 years, which can be daunting to pay back such a large amount over a long duration.

If you are part way through your mortgage term, you may find it challenging to keep up with your payments, especially if other bills have increased. In such a scenario, you may consider remortgaging to extend your term.

By extending your term, you can spread your mortgage payments over a more extended period, which can lead to lower monthly payments, thereby freeing up more disposable income. There is a downside to this option as you will end up paying more back overall, including additional interest.

It is crucial to weigh the pros and cons of extending your term before making a decision. While it can make your monthly payments more affordable, it may not be the best option for everyone. You may end up paying more in the long run, possibly even into your retirement.

If you are considering a remortgage in Leicester, there are several options available, including remortgaging to release equity or for home improvements. Extending your term is another possibility, but it is essential to seek professional advice before making a final decision.

Can I remortgage in Leicester to extend my term if I’m borrowing more money?

Extending your term can be a viable option if you’re looking to remortgage in Leicester and need to borrow additional funds, release equity, make home improvements, or consolidate debts. It’s important, however, to weigh the pros and cons before making a decision.

Extending your term can lower your monthly mortgage payments and increase your disposable income, making it easier to manage your finances. This can be especially helpful if you’re going through a difficult financial period, facing unexpected expenses, or experiencing a change in circumstances.

On the other hand, extending your term will mean that you’re paying interest over a longer period, which can result in you paying more overall. This is something to keep in mind, especially if you’re approaching retirement age or have other long-term financial goals.

It’s important to note that extending your term may not always be possible, as some lenders may have specific criteria or restrictions. It’s also important to consider other factors, such as fees and charges, when exploring your options for remortgaging in Leicester.

Ultimately, it’s important to seek professional mortgage advice and do your research before making any decisions about remortgaging in Leicester.

Whether you’re looking to extend your term, release equity, consolidate debts, or make home improvements, there are a variety of paths you can take to achieve your financial goals.

You should think carefully before securing other debts against your home. By adding your unsecured debts to your mortgage, which is secured on your home, you are potentially putting your home at risk if you cannot make the required repayments.

Although the total monthly cost of servicing your debt may have reduced, the total cost of repayment may still have risen as the term of your mortgage is longer than it may have taken to repay the debts originally.

When wouldn’t I be able to remortgage in Leicester and extend my term?

Remortgaging can be a great option for homeowners who are looking to ease their financial burden. However, it’s important to note that each lender has their own set of criteria that must be met before extending the term of a mortgage.

Factors such as age, type of mortgage, and any outstanding mortgage payment debts can all play a role in determining whether or not you are eligible for a remortgage in Leicester to extend your term.

Some lenders may have strict age restrictions, requiring borrowers to pay off their mortgage before they reach a certain age.

Fortunately, if remortgaging to extend your term is not an option for you, there are other paths to consider. A dedicated mortgage advisor in Leicester can help you explore alternative solutions that will help lower your monthly payments and improve your financial situation.

At our company, we believe that everyone deserves to enjoy the benefits of owning a home without the stress of high mortgage payments. That’s why we take the time to carefully review each client’s unique situation and recommend the most suitable options for them.

Our goal is to help our clients achieve their financial goals and find the best possible solution to meet their needs.

Can I remortgage in Leicester to extend the term of my interest only mortgage?

Extending the term of an interest only mortgage can be a challenge, as not many lenders allow it. While some may allow it, you will still need to pay the lump sum of interest at the end of the term, and some lenders may not want you to delay it any further.

Residential properties are typically on a repayment mortgage, and interest-only mortgages are now less common. Instead, they are more commonly attached to buy to let properties.

However, extending the term of an interest only mortgage on a buy to let property can also be difficult, as some lenders may not allow it while the property is occupied by a tenant. This makes it challenging to address the issue of paying back the lump sum.

In such cases, it may be a better option to remortgage your property and replace your interest-only mortgage with a repayment mortgage. This would allow you to pay back a combination of both capital and interest, making it easier to manage your mortgage repayments.

It is important to note that these are complex circumstances, and it is highly recommended that you speak to an expert member of our remortgage advice team before making any decisions. They can help you better understand your options and find the best solution for your individual circumstances.

What if I want to reduce my term instead?

A viable option to consider during the remortgage process is to reduce the term of your mortgage. This option can be applied to almost all mortgage situations and is opposite to extending the term.

Reducing the term would allow you to pay back less overall, but this would also result in higher monthly mortgage payments. It’s important to note that this option may not be feasible for everyone, as larger monthly payments may not be affordable.

To make an informed decision, it’s recommended to seek remortgage advice in Leicester from a remortgage expert who can guide you through the process and provide insights on the best option for your financial situation.

Alternatives to Extending Your Term

If you’re looking to reduce your monthly outgoings, downsizing may be a viable option to consider, rather than extending your term through remortgaging.

This involves selling your current home and moving into a smaller property, which typically costs less, resulting in a smaller mortgage and lower monthly payments.

Another option to consider if you’re over 55 and own a property worth at least £70,000 is equity release. This enables you to release tax-free funds from your home through a lifetime mortgage, either in a lump sum or through occasional payments.

However, equity release may not always be the best option, and alternatives such as “RIOs” and “TIOs” – retirement interest-only mortgages and term interest-only mortgages – may be more suitable for over 50’s.

With a RIO or TIO, the loan is only repaid when you pass away or move into long-term care, and your home is sold. To navigate the complex landscape of later life mortgage options, it’s best to seek advice from a qualified, honest later life mortgage advisor.

They can help you understand the pros and cons of each option and advise on the most suitable path for your future plans and financial goals.

To understand the features and risks of equity release and lifetime mortgages, ask for a personalised illustration.

A lifetime mortgage may impact the value of your estate and it could affect your entitlement to current and future means tested benefits. The loan plus accrued interest will repayable upon death or moving into long term care.

Gifted Deposit FAQ’s | Mortgage Advice in Leicester

What is a gifted deposit?

A gifted deposit is either a portion of or the entire amount of deposit you need to put down on a property and obtain a mortgage, given to you purely as a gift (agreed in official documentation) and with an understanding that you will not repay it.

How can gifted deposits help out?

Gifted deposits in Leicester are very useful if you are financially capable of covering the monthly mortgage repayments, but are struggling to save up for the initial deposit as a first time buyer in Leicester.

This can occur perhaps due to a lower income or frequent larger outgoings, such as rental payments and home energy bills. We hear of this a lot when we speak to first time buyers in Leicester.

In receiving a gifted deposit, you may also allow yourself to gain access to much better rates of interest during your mortgage process, especially if that gift is above the minimum 5% deposit requirement.

Who can gift the deposit?

Generally it will mainly be parents (birth and adopted) and carers who are able to gift you the deposit. This is often discussed online using the terminology “Bank of Mum & Dad”.

Other extended family members may also be able to help out with a gifted deposit. This entirely depends on the mortgage lender that you end up with though, so it is worth speaking to a mortgage advisor in Leicester ahead of time, if that is the case.

Do your parents know you need help?

We’re often quite surprised at the amount of customers who have no idea their parents are able to help with their mortgage! We also encounter a good portion who feel like they maybe can’t ask their parents for help.

The truth is, the majority of parents out there are more than happy to help their children to find a home of their own, comfortably living as opposed to struggling whilst living in a rental property.

Typically speaking, taking out a mortgage may save you more money per month than you would get from renting, as depending on the conditions of your mortgage, you could be paying much less per month.

The deposit that is gifted often comes from inheritance, although parents can sometimes gift it much earlier if they have enough money saved or have released equity from their own home.

Gifted Deposit vs Loans

The majority of mortgage lenders won’t agree to accept a loan as a means of paying off your deposit. It will be often relate to the lender not being so sure if you have the ability to afford paying both back at the same time.

Is there a maximum or minimum gifted amount?

Whilst there aren’t limits to the amount that can be gifted to a home buyer, it’s worth remembering that some lenders will want you to have at least 5% from your own savings.

In general, the more you can afford to put down, perhaps combining savings and gift, the better the deals you are going to have access to.

Who could benefit from a gifted deposit?

It will usually be first time buyers and people moving house in Leicester who will benefit the most from gifted deposit.

You may also be able to use a gifted deposit to cover the initial 5% deposit for the Help to Buy Equity Loan Scheme, though this will again depend on the mortgage lender.

What proof is required?

Your donor will be required to sign a gifted deposit form stating that it is not a loan and is in fact a gift. Additional proof such as ID, address and bank statements may be required.

Our Mortgage Advice Service in Leicester

As an open & honest mortgage broker in Leicester and surrounding areas, we always aim to provide our customers with the highest level of customer service, through a fast and friendly mortgage advice service.

We always rise above for our loyal customers, no matter the mortgage situation they are currently going through. When someone gets in touch with us for mortgage advice in Leicester, we will consider all cases, no matter how complex.

Availability of a Mortgage Advisor in Leicester

A trusted and experienced mortgage broker in Leicester is available seven days a week, from early on until late. Our advisors will be ready and waiting to offer their support at all times.

Book your free mortgage appointment today with an expert mortgage advisor in Leicester and we’ll see how we are able to help you on your mortgage journey.

A Guide to Remortgages in Leicester: Top Reasons to Consider

Remortgage Broker in Leicester

The mortgage journey can have both positives and negatives along the way, but by the end of it, you will end up with one of the following outcomes; you’ll have a dream home to possibly raise a family in, a stepping stone property to help you climb the property ladder, or you could have an investment property that you are able to rent out.

Regardless of the initial path that you took, eventually you will find that your mortgages’ fixed period is coming to an end. At this point you could possibly look to upsize or downsize into a newer home. Some landlords perhaps look to sell their portfolio or sell a home to the tenant.

We find, however, that a more popular option is for homeowners to remortgage their home instead.

What is a Remortgage?

First of all, let’s look at what defines a remortgage in Leicester. In short, a remortgage is where you use funds raised from a new mortgage, to pay off a mortgage you already have. There are a lot of different ways this can be done, each with their own benefits.

Making use of the over 20 years of knowledge that the “Moneyman” Malcolm Davidson (host of our YouTube channel MoneymanTV) has, we have put together a useful guide to all of the options that may be available to you when the time comes to remortgage.

Remortgage For Better Interest Rates

Your initial fixed period will typically last somewhere within the realm of 2-5 years and will generally have lower fixed rates or potential discounted rates. Depending on your case, you may even be placed on a tracker mortgage, which will follow along with the Bank of England’s base rate.

Once that initial fixed term ends, it is likely that you will be placed onto the lenders Standard Variable Rate (often shortened to SVR). Basically, an SVR is a mortgage with a potentially fluctuating interest rate that is dependant on what the lender themselves chooses to charge.

Whilst this does not follow the Bank of England’s base rate in the same way a tracker mortgage does, these fluctuations have been known to come about as and when there are any changes to the base rate or the market. For example, if the base rate increases, your lender may push their rate even higher.

Because of this, Standard Variable Rates tend to be pretty expensive options to take, which is why a lot of homeowners would much rather remortgage for better rates. The hope is that in doing so, you’ll be saving yourself some money on a monthly basis.

Remortgage For Home Improvements

Once you have gotten a few years into occupying your home, you may be looking for a change. Rather than move home to accommodate these changes, lots of homeowners instead look to remortgage to release equity, to cover the costs of these.

There’s lots of popular changes we hear of customers looking to achieve. Perhaps you’re in need of more space for your family or possessions. Maybe you’ve been looking to refurbish the kitchen. Some may look to convert their loft into a bedroom or a spare room into an office.

Though the idea of obtaining planning permission and managing your own project can seem intimidating, many who have done so would argue it’s a lot less stressful and a lot more rewarding than finding a new home altogether.

This may work out a lot better for the future too, as creating additional space and having good quality craftsmanship is something that is likely to increase the worth of your home. If you were to ever sell your home and move elsewhere, this would be very useful.

Remortgage for Changes to Your Term

Depending on your case, you may simply wish to remortgage in Leicester in order to access a better term. This can either be done by reducing the length of your mortgage term or by switching to a more flexible mortgage product.

Reducing the length of your term will mean that you aren’t paying back or restricted for as long, but it will most likely mean higher monthly mortgage payments for you. The longer your term is, the lower your monthly mortgage payments should be.

Some will choose for a more flexible mortgage term when the time comes to remortgage. Doing so may allow you to overpay, meaning you could pay your mortgage off quicker, as well as possibly having the option to carry the same mortgage and rates over to a different home, should you ever wish to move home.

Though this may sound like the ideal path to take, they are generally tracker mortgages, which as we touched upon before, will follow the Bank of England base rate. This makes your monthly payments a little unreliable, as depending on base rate changes, they could fluctuate in cost.

Remortgage to Release Equity

Unless a serious market crash were to occur, every homeowner will have some amount of equity in their property. Your amount is worked out as the difference between property value and your mortgage balance.

As mentioned before, people will generally remortgage to release equity as a means of funding home improvements, though there are other options for this also.

Some will use their released equity to cover long-term care costs, whereas others may use it as a boost to their income. Other popular options include to pay for a large holiday, to pay off an interest-only mortgage that is in your name or to free up some spending money.

Occasionally, we find that Buy-to-Let landlords will remortgage to release equity from a property in their portfolio, as a means of covering the deposit for a future property purchase.

Equity Release in Leicester is a possibility for those who are aged 55+ and own a home that is valued at least £70,000. Explore your options by getting in touch with an expert later life mortgage advisor who can provide further information and assist you through your process.

Remortgage to Consolidate Debt

Another reason why a homeowner may remortgage to release equity, is to pay off any unsecured debts that you may have unfortunately built up over time.

Though it seems straightforward in concept, gaining access to a debt consolidation remortgage not only bases the amount you are looking to borrow on how much you owe a creditor and what your property is worth, but also your credit rating. This means that you could have a limited borrowing capacity.

On top of this, in order to fully pay off your previous mortgage and the debts you have gathered, you will have to borrow more than the mortgage amount. This means you will most likely have higher mortgage payments per month.

Though this is not at all an ideal situation, you’ll at least find solace in knowing that should your financial state take a turn for the worse, there are options for you to explore.

If your credit rating ends up particularly damaged, it’s not completely the end of the road, though it will likely be very difficult and require specialist remortgage advice in Leicester before you are able to proceed. Even in taking that step, a mortgage is not guaranteed.

Homeowners should always take out specialist mortgage advice before beginning the process of consolidating and securing debts against their home.

Book Your Free Remortgage Review with a Mortgage Advisor in Leicester

If you are nearing the end of your primary fixed period and are considering your options for a remortgage in Leicester, we would love to speak with you. Book your free remortgage review with a trusted mortgage advisor in Leicester today. We have time slots available all throughout the week, from early until late.

One of our dedicated mortgage advisors will be able to discuss your case and any future plans you have, in order to create the most appropriate next steps for you to take on your mortgage journey. We aim to make sure that this process is quicker and smoother than when you first took out a mortgage!

Getting Prepared For A Mortgage In Leicester

Looking to Get Prepared in Leicester

Once you have gotten past the hurdle of saving the deposit, the next steps you’ll be faced with will be providing the necessary paperwork for your Mortgage Broker in Leicester.

Here we have put together a list of tips and tricks on how to be best prepared for your mortgage process, hopefully making it quicker and smoother.

Up-to-Date Credit Report

An up-to-date credit report is something that is vital to the process and should be something that you prioritise. By doing this you’ll make sure that you’re not caught off guard by any previously unpaid payments that could stop you from progressing your mortgage.

Our Mortgage Advisors in Leicester will take a look at which lender will be right for you to go with, so it’s best to make sure all your information is up-to-date and accurate, so that you can be placed with the appropriate one.

You can improve your standing on your credit report by making sure that you are on the voters roll and cancelling any old or unused credit cards that you still have in your name.

Proof of ID

You’ll need to prove to your Mortgage Broker that you are exactly who you claim to be, by providing them with photo ID. You have the option of either using a Driving license or Passport.

If you are choosing to use your Driving Licence for your proof of address, you won’t be able to use it for your proof of ID and will have to use something else.

For those who are currently working within the country and using a Visa, then this is something you will also be required to provide.

Proof of Address

As touched upon in the previous point, you will also need to provide your mortgage advisor with a proof of address. If you are using your Passport for photo ID, you will be able to use your Driving License for this.

Otherwise you can use either a utility bill or a bank statement that has been dated within the last 3 months.

Last 3 Months Bank Statements

The bank statements you provide will also help to prove how much money you earn, as well as giving some insight as to what your regular spending habits are like.

This is something that again, highlights just how important it is to prepare ahead of time and be careful as to how much money you’re spending and what you’re spending it on.

Not all mortgage lenders will want to see your bank statements, though the majority will, so it is important to make sure that you have these to hand just in case.

Evidence of Deposit

Whilst you may have already saved up your deposit for the property you’re looking to buy, you will still have to provide proof of how this was saved for anti-money laundering purposes and demonstrate that you have everything in place for it.

A useful tip that we would suggest here, is to make sure your finances are stable and in one place, so that when it comes to the audit trail, everything is simple and can be checked over quickly.

Proof of Income

To show the mortgage lender that you can in fact afford their mortgage payments, you will need to prove your income.

For customers in regular employment, as touched upon before, you’ll need the last 3 months payslips. On top of this though, some lenders will want to see the most recent P60.

Lenders may also consider various other factors such as overtime, commission, bonuses and any earnings you have gained from other employers.

If you happen to instead be a self-employed mortgage applicant, then you will also need the help of your accountant who will obtain for you, your last 2 or 3 years proof of earnings.

For those of you who submit your own accounts, we will be more than happy to advise you on what you’ll need to obtain from the Government gateway.

Budget Planner

By creating a solid plan of what your budget will be, you will be able to gain a wider perspective of where you will need to spend your money and what everything is.

It is best to make a list of things such as your council tax, utility bills, and anything that you have to regularly spend money on, such as food and drink. Doing this will help to determine how much disposable income you have overall once those payments have gone out.

If you are struggling with this, then we would be happy to send you a budget planner template so that you can get started.

In summary, preparation is crucial for a First Time Buyer in Leicester to get their mortgage sorted as quickly and efficiently as they possibly can, and this will only be made simpler by seeking out expert Mortgage Advice in Leicester.

The quicker you put in the time and effort to collect all of the essential information you need, the easier it will be to speed up your process and get an extra step further to achieving your mortgage goals.

Should I Use My Estate Agent’s In-House Mortgage Advisor?

Estate Agent Mortgage Advice in Leicester

During the start of your mortgage journey, you’ll most likely have to deal with an estate agent. If you end up in conversation with a larger estate agent, they will want you to use their own in-house team of mortgage advisors & conveyancers.

A lot of first time buyers in Leicester fall into this and are persuaded to use their services, usually spending more money than they otherwise would’ve had to.

The good news is that you don’t need to use their advisor at all, a point we’ll expand upon later on, and you may also open yourself up the either the same deals or better by going elsewhere.

Speaking to a Mortgage Advisor in Leicester outside of the estate agent could be a much better route for you to follow. The advisor working for the estate agent will give you a biased view that only benefits them and their profit.

A dedicated mortgage broker in Leicester will help you see the positives and negatives of each side. If you do still choose to go with the estate agents mortgage advisor, that is okay, though it’s important to remember that you have options.

We always aim to be transparent & efficient, looking to give the best possible experience and the best advice for our customers personal and financial circumstances, whilst providing a fast & friendly mortgage advice service.

Sales tactics of estate agents

If you do opt to use the services of your estate agent’s in-house mortgage advisor and conveyancer, have a good think about where their service cost is coming from.

They could potentially be charging you for their services without asking you and adding it onto the costs of other services, hoping you won’t notice.

Taking on expert mortgage advice in Leicester will reduce your concerns of this, as you will be well informed and aware of what you’re paying for. Your dedicated advisor will break down the cost of everything for you.

Even though it is highly illegal for them to do so, if you have opted not to use their services, they may refuse to put your property offers forward.

For example, you could be instead using the services of a mortgage broker and they may push forward someone else’s offer to completion over yours, purely out of spite that you didn’t use their services. Once again, this type of practice is illicit behaviour.

Estate agents may get even attempt to charge their customers extortionate fees for in-house conveyancing. Even with a straightforward purchase, you may find yourself being charged somewhere within the realm of £1,500, which is far too much.

Any time this occurs, you have full consumer rights to be given a full breakdown of exactly why it costs this much and where their calculations came from.

An experienced mortgage broker in Leicester will only want to do right by the customer. By coming to us for mortgage advice, you can avoid the tactics mentioned above.

How can I get a mortgage in Leicester?

Finding The Right Mortgage Advisor

Making sure you use the right Mortgage Advisor can be difficult; but can you make it easier?

From time to time, mortgage cases may require specialist care from a trusted mortgage advisor in Leicester. The in-house mortgage advisors from the estate agents don’t care for the details, so long as they can make a profit from it, even if it’s detrimental to you.

Speaking to an expert mortgage broker in Leicester you’ll find yourself matched up with an appropriate advisor with experience in a situation that’s at least similar to yours. They will work with you to ensure you get the right outcome.

An example of this would be the buy-to-let mortgage experts we have on hand for any landlords, new or experienced, looking to get a mortgage.

Once you’ve completed your free mortgage appointment and obtained an agreement in principle (we can normally get this for you within 24 hours of your appointment), your mortgage process can finally get underway.

We utilise our many collective years of providing open & honest mortgage advice in Leicester, helping thousands of customers achieve their home owning goals and dreams. Our customer reviews are a great inside look at how much of a difference our service makes to homeowners.

Kickstarting Your Own Mortgage Journey

Some people would rather take on the world of mortgages by themselves, and this is okay! The internet is a wonderful place and you can now do most of what you would need to do, by yourself on your browser.

By utilising price comparison websites, you may be able to find the best mortgage deal for your circumstances through your own research and understanding.

An obvious benefit to doing this would be that you’d save money on additional fees. Providing you have confidence in what you’re doing and understand the process, you could get through it awfully quick, more so than someone going to their bank.

The catch is that online mortgage shopping is quite difficult to do. Before you make any agreements, you should always make sure you have the best fit for your circumstances. Here are some tips if you’re doing this;

• Can you match the criteria for the “Best Buy” rates? Check before you apply for anything, to reduce the risk of harm to your credit score.
• Have you conducted the right research? A lot of comparison sites have commission based relationships with lenders. It’s their job to direct you to these companies for a payday. If they do not have a commercial relationship with a certain lender, they may just leave that deal off the list.
• In the event you encounter a problem along the way, you could be at a financial disadvantage. Pay attention to valuation and applications fees if you are not 100% sure you have been accepted, as they won’t be refundable.
• Progressing your application and sorting out any future concerns is solely your responsibility.

Should I Use My Bank or a Mortgage Broker?

Using Your Bank’s Mortgage Advisor

Making an appointment with a bank to speak to a mortgage advisor may be challenging. This isn’t always the case, though it also may just be the wrong choice for you to make. Here are a few things to look out for;

• The bank won’t shop around for the best deal, they will only present their own products, some of which may not even be suitable for you.
• No matter how long you’ve banked with them, you may find yourself getting declined. We’ve had genuine instances where 20 plus year customers have been turned away for lack of information.
• Mortgage appointments with a bank tend to have a long waiting list, with some lenders’ waiting lists being almost 6-months long.
• Your bank may have inexperienced mortgage advisors and struggle to help with difficult circumstances. Instead of solving problems, they have been known to just turn people away.

Using a Mortgage Broker in Leicester

Taking on the services of a mortgage broker that has no association with any estate agents ensures that you, as an inexperienced first time buyer in Leicester, have someone there to do the hard work for you, without any conflict of interest risks.

We work for you and only you, with no external ties. Whilst we do have mortgage lenders on panel, we don’t work for them, we simply match customers up to their various unique deals.

Our team do what they can to make sure you’re happy with your mortgage journey and the outcome you end up with. Managing Director Malcolm Davidson is here to explain both the positives and negatives of using a trusted mortgage broker:

The Pros and Cons of Using a Mortgage Broker in Leicester

As could likely be predicted, we personally feel like there are some really great reasons why you should use a mortgage broker in Leicester. This isn’t born out of bias, however, as we understand there are pros and cons to both, no matter if you’re a first time buyer in Leicester, looking to remortgage in Leicester, or have another situation.

Regardless of if you’re going via a branch or online, you are still able to go direct to the mortgage lender yourself. Below are all the pros and cons to either of your options.

Pros & Cons

When thinking about going direct to a bank or building society, the first thing that springs to mind is that you won’t be required to pay a broker fee, which in turn would possibly save you money. In the past, another positive that people thought of was “the bank manager knows my finances inside out”, though after credit scoring systems were introduced, this no longer became a factor.

On top of this, some mortgage lenders will have exclusive mortgage products on offer, that can only be obtained by going direct. They offer these as a way of attracting a good spread of business from their consumers and other brokers, turning exclusive products on and off whenever they believe it to be necessary. On the other side of the coin, some products may only be accessible by going to the broker and not by going direct to the lender.

From 2014 onwards, lenders were restricted from selling their mortgages on a non-advised basis to any customers of their services (those with bank accounts, for example). Up until that point, some applicants felt like members of staff who were not qualified for giving advice, were pushing their services on them.

They also felt like they weren’t able to benefit from some of the consumer protection that would normally come with mortgage sales performed by professionally trained mortgage advisors in Leicester.

The changes took a long while for lenders to come to terms with and towards the back end of 2014, it was not uncommon for customers to have to wait a long time to get a mortgage appointment. This is unfortunately still the case today sometimes. When you have had an offer accepted on a house, this is the last thing you need or want!

Because of the issues present with going direct, much like the wait for an appointment, more and more applications were made with mortgage brokers who could freely offer a same day service, something we are able to do ourselves. When you get in touch with us, we get you booked in with a mortgage advisor in Leicester as quick as we can, either on the same day or at your earliest convenience.

Affordability is an important factor too, as the quality of a lenders deal won’t matter if you have no way of affording it. Buying a house is such a large step in people’s lives, that they often would rather get professional and personal advice from a qualified and experienced mortgage advisor in Leicester.

Handling Difficult Cases

Nowadays we find that a lot of mortgage applications aren’t as simple anymore. For whatever reason it may be, there are so many things that can make a case more complicated. Some examples of these are:

• Mixed source of deposit (savings/gift)
• Poor credit history
• Let to Buy (keeping your current house and buying another)
• Affordability
• Contract workers/zero hours contracts
• Self-Employed Income

In the past, mortgage lenders were able to stand head and shoulders above the competition by simply offering a deal that was similar to one offered by another lender, but with slight differences to make it more appealing. Fast forwarding to where we are now and it is all so much more different, with lending criteria being the difference maker between deals and lenders.

An example of this, is that some lenders may lend more than other lenders might have to Self Employed applicants. Some also take a more sympathetic view on previous discrepancies that are showing on your credit report.

Your situation will be unique to you. It may be similar, but it will never be the same as another case. When you explain your position to an experienced mortgage broker, it is highly likely that there will at least be at least something similar that we have encountered before, allowing for a more personalised service. Hopefully, our hard working mortgage advisors will be able to get you a favourable deal with good interest rates.

It’s more than just getting a mortgage though. Even if the application itself is fairly easy, our customers who are first time buyers in Leicester rely on our experience and knowledge for more insight into the mortgage process.

For example, we are able to sit and discuss how much they are going to offer on the property they are buying. From there, our team of mortgage advisors in Leicester can recommend our customers other necessary professional services such as solicitors, whilst also explaining the different types of property survey and protection that is available to them.

Responsive Service

One of the main pros of using a mortgage broker in Leicester, we believe, is that we are a lot more responsive than the mortgage lenders have been known to be. Our team work from early until late, all throughout the week (including out of hours), dedicated to our customers and ensuring the process is as speedy and stress-free as it can be.

Something that does get overlooked from time to time when looking at why customers may prefer to use a broker, is that everyone nowadays everyone has such a busy schedule. You might need a mortgage but don’t have the required time to sort it out. In these cases, your mortgage advisor can take the weight off your shoulders and work through it for you.

Professional applicants especially will see the benefits of this service, as they have clients of their own that they charge out their services to and often don’t have the time to work through it themselves. The customers we deal with regularly appreciate the benefits of having an expert on their side.

Perhaps in the future we’ll see lenders wanting to limit their links to brokers and wanting to take their business back. If this does happen, we don’t see it being likely that they will hire more staff in their branch networks. The future of all industry seems to be based around technology and the mortgage market may very well be heading this way too.

That may work for customers who are more than happy to do business with a “robo-advisor”, especially for cases that are easy and don’t require a thorough analysis. For the majority of people, however, there’s an element of “realness”, that “human touch” that can’t be obtained by going this route, and can only be found by speaking to a real mortgage advisor in Leicester.

To find out more information on our service or to present any mortgage queries that you have, please Contact Us and we’ll book you in for an appointment with a mortgage advisor in Leicester as soon as we can.

How Much Deposit Do I Need To Buy A House in Leicester?

Deposit Mortgage Advice in Leicester

The circumstances you find yourself in will dictate the amount of deposit you will need for a property that you set your sights on. In this article we will take a look at how much deposit may be required, based on your personal situation.

Why do I need a deposit for a mortgage in Leicester?

Previously, it would be quite a common sight to find 100% mortgages. Before their eventual fall, even Northern Rock were offering their customers 125% loan to value mortgages. What that means, is if you were buying a property valued at £100,000 they would still lend you up to a whopping £125,000, and yet people wonder what went wrong…

The reason that these mortgage lenders will need you to put down a deposit, is to reduce their lending risk. If they lend a customer exactly 100% of the purchase price and that customer unfortunately falls into arrears, they would then have to repossess the property.

From there, lets say property prices dipped; now they’re trying to sell a house that’s worth even less, in order to make their money back. Naturally, with lower house prices, that’s not going to happen and they will be at a financial loss. Because of this reason, the higher percentage you’ll find is a 95% mortgage, requiring only a 5% deposit from you.

It’s also believed throughout the mortgage world, that if you haven’t invested some of your own or your family’s money into your home, then you are likely to be less attached and more willing to give up if making payments becomes challenging.

As well as this, many lenders feel that if you can’t save up at least a 5% deposit for a property, or even find someone to gift you this amount, then you probably aren’t quite ready to join the property ladder.

Can the government pay the deposit for me?

Not directly, however, if you are able to find 5% of the deposit required from your own saved income, then you may happen to qualify for the government Help to Buy Equity Loan Scheme.

This government scheme only applies to new build properties, with the idea being that you put in 5% and then the government will loan you up to 20%, making up a total of a 25% deposit. After 5 years, you need to look at paying back the equity loan back, sometimes through a remortgage or from savings you have been able to make during that time.

Is a 5% deposit enough?

In most cases, you’ll find that 5% is considered enough to put down for a deposit on a property, however, not all lenders will offer 95% mortgages, which can leave you with limited options. Saving up for a larger deposit, for example, 10% deposit, will open the door to more products and most likely at a lower rate of interest.

With the majority of 95% deals, you will normally need a good credit score to qualify. There are lenders out there that may consider you for a 95% mortgage with a fairly average credit score, but you would probably incur a much higher rate of interest.

How much do I need to put down if I have a poor credit history?

In the event of a poor credit history, the majority of the specialist lenders will require a minimum of 15% deposit if you have a poor credit history. As mentioned earlier on in this article, the reason the lender will need a deposit is simply to reduce their risk in case a repossession occurs.

How much deposit do I need for a Buy-to-Let property?

It has always been a requirement to put down a larger deposit for buy-to-let mortgages and the majority of lenders at the moment are looking for at least 25%.

Can I take out a loan for the deposit?

Technically, this could be possible, though pretty much all lenders will not allow this, as essentially this would still be 100% lending. Again, this no longer exists due to the aforementioned risk involved with such a financial process.

Can someone gift me a deposit?

Yes, this happens all the time. We will often see this being called the “Bank of Mum and Dad” (both birth and adopted parents, as well as carers & legal guardians) gifting their loved ones the deposit, or other family members such as any Aunties & Uncles.

We have even seen instances where family friends are able to gift you money. These are all perfectly acceptable options, providing they are able to evidence the funds, prove who they are and confirm they are not expecting repayment of the gift in the future. We have written a detailed article all about Gifted Deposits in Leicester.

Are there any circumstances where I don’t need a deposit?

If you are buying as a sitting tenant and your landlord or family member has given you a discount from the properties value on the open market, or if you qualify for a discount to buy from your local authority (housing association or council) under the Right to Buy Scheme, then you will typically not need to put any of your own money in as deposit. This is due to the existing equity being already “built-in” to the mortgage deal.

Please bear in mind that the above information is for reference purposes only and is not to be viewed as personal financial or mortgage advice in Leicester.

Help to Buy Mortgage Advice in Leicester

Make the most of Help-to-Buy Scheme in Leicester

The Help-to-Buy Scheme in Leicester is a widely known way for many first-time buyers to find their footing on the property ladder, though it can be confusing for many who are researching for the first time. There have been various different aspects that come under the terminology, so you may not fully understand what you’re getting into.

The most common one that is still around and the one you would be using as a first-time buyer, is the Help-to-Buy Equity Loan Scheme. You can rest assured that you will have us to support and guide you throughout your mortgage process. Not only will we assist you with understanding the scheme, but we will scour the market until we find the best mortgage deal for you and your personal circumstances.

You will find that having our brilliant mortgage advisors in Leicester on hand is not only incredibly helpful in securing your mortgage but also in working through the sometimes complicated processes of the government Help-to-Buy Scheme.

How does the Help-to-Buy Equity Loan Scheme work?

The scheme was set up by the government, primarily to help homeowners, including first-time buyers. If you decide to make use of the scheme, the following will apply to you and your mortgage process:

• You will require a minimum of 5% deposit.
• Up to 20% of the property’s value get treated as an equity loan from the Government.
• The balance will be covered by a specialised Help-to-Buy mortgage.

How do you qualify for the Help-to-Buy Scheme in Leicester?

If you think that you qualify to use this scheme but are not sure whether or not you will have the ability to do so, simply get in touch with us and one of our dedicated mortgage advisors in Leicester will take a look at your circumstances. Once we have gotten a measure of your situation, we will be able to check whether you fall within the criteria of the offer.

Our mortgage service is tailor-made specifically to suit you and your needs regarding a mortgage. The Help-to-Buy Equity Loans apply to new-build properties up to a maximum value of £600k. The purchase price of the property gets made up of your 5% deposit, 20% government loan, and 75% balance covered by the mortgage that we will locate for you.

Help-to-Buy mortgage advice in Leicester

Once you get in touch, we will take the time to talk you through the whole mortgage process. If the property that you wish to buy fulfills the terms, we can discuss the scheme with you in larger detail. Whether you are purchasing from a builder or via an estate agent, we can communicate with them on your behalf.

As soon as you contact us, we will arrange a convenient time to suit you for your free, no-obligation mortgage consultation. If you are not clear on the figures and how the process works, we will go through the calculations with you until it is all understood.

We will take the time to ensure that not only are you happy with the figures but that they are affordable and fit in well with your financial circumstances and levels of income.

Right to Buy Mortgage Advice in Leicester

Mortgage Advisors in Leicester

If you are based in Leicester and living in a property owned by your local authority (that means your local council or housing association), you may have the opportunity to buy your home through use of a Right-to-Buy in Leicester.

The Right-to-Buy Scheme, providing you have the eligibility to do so, allows you to buy a property at a discounted price. This means that instead of paying a particular amount in rent to the owner for a property that isn’t yours, whilst the monthly mortgage payment may vary, you are able to truly call it home.

If you are new to the Right-to-Buy Scheme in Leicester or are confused about anything we mention here and would like guidance, please Get in Touch with our dedicated mortgage advisors in Leicester. They’re readily available throughout the day to answer any questions you may have.

Right-to-Buy Mortgage Advice to Buy Your Rented Home

We have a lot of experience in working with Right-to-Buy mortgages from our many years in the industry. As such we know how it works like the back of our hand and will be able to talk you through the process.

If you have no prior knowledge of the Right-to-Buy Scheme in Leicester, i.e., this is the first you’ve heard of it, it might be worth your time contacting your local authority to check whether or not you’re eligible to buy your rented home.

Once they have confirmed eligibility, you should receive a Right-to-Buy an offer from them, highlighting what the prices of the property will be when the scheme is in place and ready to go. The offer usually holds an expiry date, so you will need to speak with a fast & friendly mortgage advisors in Leicester in plenty of time before that period ends.

After you get in touch with us, we will book you in with a free initial mortgage consultation, taking account of your details so that we can understand your situation. You’ll speak to an experienced and dedicated advisor, who will hold your hand through the process.

How do I find out if I qualify for a Right-to-Buy discount?

To qualify for the Right-to-Buy discount, you should have been living in your rental property for three years, whether this is three years continuous or not.

The Right-to-Buy discount won’t be available to you if any of the following apply:

• The property in question is not your main home.
• You share facilities, i.e., a house share.
• You’re on an introductory tenancy.
• A court order got issued asking you to vacate.
• You’re subject to an undischarged bankruptcy.
• There are creditors that you owe outstanding money.

Exceptional living circumstances may also not be accepted, e.g., selected housing for the elderly or if you have a career in a specific sector.